SFIL 5,000,000,000 Euro Medium Term Note Programme

Transcription

1 Base Prospectus dated 27 September 2017 SFIL 5,000,000,000 Euro Medium Term Note Programme Under the Euro Medium Term Note Programme described in this Base Prospectus (the "Programme"), SFIL (the "Issuer"), subject to compliance with all relevant laws, regulations and directives, may from time to time issue Euro Medium Term Notes (the "Notes"). The aggregate nominal amount of Notes outstanding will not at any time exceed 5,000,000,000 (or the equivalent in other currencies at the date of issue of any Notes). This Base Prospectus replaces and supersedes the base prospectus dated 27 September 2016 and shall be in force for a period of one (1) year as of the date of its approval by the Autorité des marchés financiers (the AMF ). Application has been made to the AMF in France for approval of this Base Prospectus in its capacity as competent authority pursuant to Article of its Règlement Général which implements Directive 2003/71/EC of 4 November 2003, as amended on the prospectus to be published when securities are offered to the public or admitted to trading (the "Prospectus Directive"). Application may be made for Notes issued under the Programme during a period of twelve (12) months from the date of this Base Prospectus to be admitted to trading on Euronext Paris and/or on a Regulated Market (as defined below) in another Member State of the European Economic Area ("EEA"). Euronext Paris is a regulated market for the purposes of the Markets in Financial Instruments Directive 2004/39/EC as amended (a "Regulated Market"). However, Notes which are not admitted to trading on a Regulated Market, or which are not offered to the public, in a Member State of the EEA may also be issued under the Programme and may also be admitted to trading on an unregulated market or may not be admitted to trading at all. The relevant final terms (the "Final Terms") (forms of which are contained herein) in respect of the issue of any Notes will specify whether or not such Notes will be admitted to trading and/or offered to the public and, if so, the relevant Regulated Market in the EEA and/or the Member State(s) in the EEA where the Notes will be offered to the public and will be published, if relevant and if required by any applicable regulation, on the website of the Regulated Market where the admission to trading is sought. This Base Prospectus constitutes a base prospectus for the purposes of article 5.4 of the Prospectus Directive. Notes may be issued either in dematerialised form ("Dematerialised Notes") or in materialised form ("Materialised Notes") as more fully described herein. Dematerialised Notes will at all times be in book-entry form in compliance with Articles L et seq. and R et seq. of the French Code monétaire et financier. No physical documents of title will be issued in respect of the Dematerialised Notes. Dematerialised Notes may, at the option of the Issuer, be in bearer dematerialised form (au porteur) inscribed as from the issue date in the books of Euroclear France ("Euroclear France") (acting as central depositary) which shall credit the accounts of Account Holders (as defined in "Terms and Conditions of the Notes Form, Denomination(s), Title and Redenomination") including Euroclear Bank S.A./N.V. ("Euroclear") and the depositary bank for Clearstream Banking, S.A. ("Clearstream") or in registered dematerialised form (au nominatif) and, in such latter case, at the option of the relevant Noteholder (as defined in "Terms and Conditions of the Notes Form, Denomination(s), Title and Redenomination"), in either fully registered form (au nominatif pur), in which case they will be inscribed either with the Issuer or with the registration agent (designated in the relevant Final Terms) for the Issuer, or in administered registered form (au nominatif administré) in which case they will be inscribed in the accounts of the Account Holders designated by the relevant Noteholders. Materialised Notes will be in bearer materialised form only and may only be issued outside France. A temporary global certificate in bearer form without interest coupons attached (a "Temporary Global Certificate") will initially be issued in connection with Materialised Notes. Such Temporary Global Certificate will be exchanged for Definitive Materialised Notes in bearer form with, where applicable, coupons for interest attached, on or after a date expected to be on or about the 40th day after the issue date of the Notes (subject to postponement as described in "Temporary Global Certificates issued in respect of Materialised Bearer Notes") upon certification as to non U.S. beneficial ownership as more fully described herein. Temporary Global Certificates will (a) in the case of a Tranche (as defined in "Terms and Conditions of the Notes Form, Denomination(s), Title and Redenomination") intended to be cleared through Euroclear and/or Clearstream, be deposited on the issue date with a common depositary on behalf of Euroclear and/or Clearstream and (b) in the case of a Tranche intended to be cleared through a clearing system other than or in addition to Euroclear and/or Clearstream or delivered outside a clearing system, be deposited as agreed between the Issuer and the relevant Dealer (as defined below). The minimum denomination of each Note admitted to trading on a Regulated Market or offered to the public, in a Member State of the EEA, in circumstances which require the publication of a Base Prospectus under the Prospectus Directive will be at least Euro 1,000 (or the equivalent amount in such currency) or such other higher amount as may be allowed or required from time to time by the relevant central bank (or equivalent body) or any laws or regulations applicable to the relevant Specified Currency. The Notes (and, where applicable, the Coupons and the Talons) are governed by, and shall be construed in accordance with, French law. The final terms of the relevant Notes will be determined at the time of the offering of each Tranche based on then prevailing market conditions and will be set out in the relevant Final Terms. The long term senior debt of the Issuer has been assigned a rating of AA by Standard & Poor s Credit Market Services France SAS ("S&P"), Aa3 by Moody s Investors Service Ltd ("Moody s") and AA- by Fitch France SAS ("Fitch"). The Notes issued under the Programme may be unrated or rated differently from the current ratings of the Issuer. The rating of Notes (if any) will be specified in the Final Terms. Each of S&P, Moody s and Fitch is established in the European Union and is registered under Regulation (EC) No. 1060/2009 on credit ratings agencies, as amended (the "CRA Regulation"). Each of S&P, Moody s and Fitch is included in the list of credit rating agencies registered in accordance with the CRA Regulation published on the European Securities and Markets Authority's website ( as of the date of this Base Prospectus. A rating is not a recommendation to buy, sell or hold securities and may be subject to suspension, change or withdrawal at any time by the assigning rating agency. This Base Prospectus and the documents incorporated by reference in this Base Prospectus will be available on the websites of the Issuer ( and the AMF ( The Final Terms related to the Notes admitted to trading on any Regulated Market in the EEA will be published on the website of the AMF.

2 Prospective investors should have regard to the factors described under the section headed "Risk factors" in this Base Prospectus before deciding to invest in the Notes issued under the Programme. Barclays CITIGROUP Deutsche Bank J.P. Morgan Arranger Barclays Dealers Société Générale Corporate & Investment Banking BNP PARIBAS Crédit Agricole CIB HSBC NATIXIS 2

3 This Base Prospectus (together with any supplements to this Base Prospectus published from time to time (each a "Supplement" and together the "Supplements")) constitutes a base prospectus for the purposes of Article 5.4 of the Prospectus Directive in respect of, and for the purpose of giving information with regard to, the Issuer, the Issuer and its consolidated subsidiaries taken as a whole (the "Group") which is necessary to enable investors to make an informed assessment of the assets and liabilities, financial position, profit and losses and prospects of the Issuer. This Base Prospectus should be read and construed in conjunction with any Supplement that may be published from time to time and with all documents incorporated by reference (see "Information Incorporated by Reference") and in relation to any Series (as defined herein) of Notes, should be read and construed together with the relevant Final Term(s) (the Base Prospectus and the Final Terms being together, the "Prospectus"). No person has been authorised to give any information or to make any representation other than those contained in this Base Prospectus in connection with the issue or sale of the Notes and, if given or made, such information or representation must not be relied upon as having been authorised by the Issuer or any of the Dealers or the Arranger. Neither the delivery of this Base Prospectus nor any sale made in connection herewith shall, under any circumstances, create any implication that there has been no change in the affairs of the Issuer or the Group since the date hereof or the date upon which this Base Prospectus has been most recently amended or supplemented or that there has been no adverse change in the financial or trading position of the Issuer or the Group since the date hereof or the date upon which this Base Prospectus has been most recently amended or supplemented or that any other information supplied in connection with the Programme is correct as of any time subsequent to the date on which it is supplied or, if different, the date indicated in the document containing the same. The distribution of this Base Prospectus and the offering or sale of the Notes in certain jurisdictions may be restricted by law. Persons into whose possession this Base Prospectus comes are required by the Issuer, the Dealers and the Arranger to inform themselves about and to observe any such restriction. The Notes have not been and will not be registered under the United States Securities Act of 1933, as amended (the "Securities Act") or with any securities regulatory authority of any state or other jurisdiction of the United States and may include Materialised Notes in bearer form that are subject to U.S. tax law requirements. Subject to certain exceptions, Notes may not be offered, sold or, in the case of Materialised Notes in bearer form, delivered within the United States or to or for the account or benefit of U.S. persons (as defined in Regulation S under the Securities Act ("Regulation S") or, in the case of Materialised Notes in bearer form, the U.S. Internal Revenue Code of 1986, as amended (the "U.S. Internal Revenue Code" and the regulations thereunder)). For a description of certain restrictions on offers and sales of Notes and on distribution of this Base Prospectus, see "Subscription and Sale". The Notes are being offered and sold only outside the Untied States of America to non-u.s. persons in reliance upon an exemption from registration under the Securities Act pursuant to Regulation S. IMPORTANT - EEA RETAIL INVESTORS If the Final Terms in respect of any Notes include a legend entitled Prohibition of Sales to EEA Retail Investors, the Notes are not intended, from 1 January 2018, to be offered, sold or otherwise made available to and, with effect from such date, should not be offered, sold or otherwise made available to any retail investor in the European Economic Area (the EEA ). For these purposes, a retail investor means a person who is one (or more) of: (i) a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU ( MiFID II ); (ii) a customer within the meaning of Directive 2002/92/EC ( IMD ), where that customer would not qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II; or (iii) not a qualified investor as defined in the Prospectus Directive. Consequently, no key information document required by Regulation (EU) No 1286/2014 (the PRIIPs Regulation ) for offering or selling the Notes or otherwise making them available to retail investors in the EEA has been prepared and therefore offering or selling the Notes or otherwise making them available to any retail investor in the EEA may be unlawful under the PRIIPS Regulation. This Base Prospectus does not constitute an offer of, or an invitation by or on behalf of the Issuer or the Dealers or the Arranger to subscribe for, or purchase, any Notes. 3

4 The Arranger and the Dealers have not separately verified the information contained in this Base Prospectus. None of the Dealers or the Arranger makes any representation, express or implied, or accepts any responsibility, with respect to the accuracy or completeness of any of the information in this Base Prospectus. Neither this Base Prospectus nor any other financial statements or any other information incorporated by reference are intended to provide the basis of any credit or other evaluation and should not be considered as a recommendation by any of the Issuer, the Arranger or the Dealers that any recipient of this Base Prospectus or any other financial statements or any other information incorporated by reference should purchase the Notes. Each potential purchaser of Notes should determine for itself the relevance of the information contained in this Base Prospectus and its purchase of Notes should be based upon such investigation as it deems necessary. None of the Dealers or the Arranger undertakes to review the financial condition or affairs of the Issuer during the life of the arrangements contemplated by this Base Prospectus nor to advise any investor or potential investor in the Notes of any information coming to the attention of any of the Dealers or the Arranger. In this Base Prospectus, unless otherwise specified or the context otherwise requires, references to " ", "Euro", "EUR" or "euro" are to the single currency introduced at the start of the third stage of European economic and monetary union pursuant to the Treaty on the Functioning of the European Union, as amended, references to " ", "pounds sterling", "GBP" and "Sterling" are to the lawful currency of the United Kingdom, references to "$", "USD" and "U.S. Dollars" are to the lawful currency of the United States of America. 4

5 Table of Contents SUMMARY OF THE PROGRAMME... 6 RÉSUMÉ EN FRANÇAIS DU PROGRAMME (FRENCH SUMMARY OF THE PROGRAMME) 30 RISK FACTORS CONDITIONS ATTACHED TO THE CONSENT OF THE ISSUER TO USE THE PROSPECTUS INFORMATION INCORPORATED BY REFERENCE SUPPLEMENT TO THE BASE PROSPECTUS TERMS AND CONDITIONS OF THE NOTES TEMPORARY GLOBAL CERTIFICATES ISSUED IN RESPECT OF MATERIALISED BEARER NOTES USE OF PROCEEDS DESCRIPTION OF THE ISSUER RECENT DEVELOPMENTS TAXATION SUBSCRIPTION AND SALE PRO FORMA FINAL TERMS FOR USE IN CONNECTION WITH ISSUES OF NOTES WITH A DENOMINATION OF LESS THAN 100,000 TO BE ADMITTED TO TRADING ON A REGULATED MARKET OR REGULATED MARKETS AND/OR OFFERED TO THE PUBLIC IN THE EUROPEAN ECONOMIC AREA PRO FORMA FINAL TERMS FOR USE IN CONNECTION WITH ISSUES OF NOTES WITH A DENOMINATION OF AT LEAST 100,000 TO BE ADMITTED TO TRADING ON A REGULATED MARKET GENERAL INFORMATION RESPONSIBILITY STATEMENT

6 SUMMARY OF THE PROGRAMME Summaries are made up of disclosure requirements known as "Elements" the communication of which is required by Annex XXII of the Regulation EC No 809/2004 of 29 April 2004, as amended. These Elements are numbered in Sections A E (A.1 E.7). This summary contains all the Elements required to be included in a summary for this type of securities and for SFIL (the "Issuer"). Because some Elements are not required to be addressed, there may be gaps in the numbering sequence of the Elements. Even though an Element may be required to be inserted in the summary because of the type of securities and Issuer, it is possible that no relevant information can be given regarding such Element. In this case a short description of the Element is included in the summary and marked as "Not applicable". This summary is provided for purposes of the issue by the Issuer of the Notes of a denomination of less than 100,000 which are offered to the public or admitted to trading on a Regulated Market of the European Economic Area (the "EEA"). The issue specific summary relating to this type of Notes will be annexed to the relevant Final Terms and will comprise (i) the information below with respect to the summary of the Base Prospectus and (ii) the information below included in the items "issue specific summary". Section A Introduction and warnings A.1 General disclaimer regarding the summary A.2 Information regarding consent by the Issuer to the use of the Prospectus This summary must be read as an introduction to the Base Prospectus. Any decision to invest in the Notes should be based on a consideration by any investor of the Base Prospectus as a whole, including any documents incorporated by reference and any supplement from time to time. Where a claim relating to information contained in the Base Prospectus is brought before a court, the plaintiff may, under the national legislation of the Member State of the EEA where the claim is brought, be required, have to bear the costs of translating the Base Prospectus before the legal proceedings are initiated. Civil liability attaches only to those persons who have tabled the summary, including any translation thereof, but only if the summary is misleading, inaccurate or inconsistent when read together with the other parts of the Base Prospectus or it does not provide, when read together with the other parts of the Base Prospectus, key information in order to aid investors when considering whether to invest in the Notes. In the context of any offer of Notes in France (the "Public Offer Jurisdictions") that is not within an exemption from the requirement to publish a prospectus under the Prospectus Directive, as amended, (a "Public Offer"), the Issuer consents to the use of the Base Prospectus and the relevant Final Terms (together, the "Prospectus") in connection with a Public Offer of any Notes during the offer period specified in the relevant Final Terms (the "Offer Period") and in the Public Offer Jurisdiction(s) specified in the relevant Final Terms by: (1) any financial intermediary duly authorised designated in such Final Terms; or (2) if so specified in the relevant Final Terms, any financial intermediary which satisfies the following conditions: (a) acts in accordance with all applicable laws, rules, regulations and guidance of any applicable regulatory bodies (the Rules ), from time to time including, without limitation and in each case, Rules relating to both the appropriateness or suitability of any investment in the Notes by any person and disclosure to any potential investor; (b) complies with the restrictions set out under Subscription and Sale in this Base Prospectus which would apply as if it were a Dealer; (c) ensures that any fee (and any commissions or benefits of any kind) received or paid by that financial intermediary in relation to the offer or sale of the Notes is fully and 6

7 clearly disclosed to investors or potential investors; (d) holds all licences, consents, approvals and permissions required in connection with solicitation of interest in, or offers or sales of, the Notes under the Rules; (e) retains investor identification records for at least the minimum period required under applicable Rules, and shall, if so requested, make such records available to the relevant Dealer(s) and the Issuer or directly to the appropriate authorities with jurisdiction over the Issuer and/or the relevant Dealer(s) in order to enable the Issuer and/or the relevant Dealer(s) to comply with anti-money laundering, anti-bribery and know your client rules applying to the Issuer and/or the relevant Dealer(s); (f) does not, directly or indirectly, cause the Issuer or the relevant Dealer(s) to breach any Rule or any requirement to obtain or make any filing, authorisation or consent in any jurisdiction; and (g) satisfies any further conditions specified in the relevant Final Terms; (each an Authorised Offeror ). The Issuer accepts responsibility, in the Public Offer Jurisdiction(s) specified in the Final Terms, for the content of the Prospectus in relation to any person (an Investor ) in such Public Offer Jurisdiction(s) to whom an offer of any Notes is made by any Authorised Offeror and where the offer is made during the period for which that consent is given. However, neither the Issuer nor any Dealer has any responsibility for any of the actions of any Authorised Offeror, including compliance by an Authorised Offeror with applicable conduct of business rules or other local regulatory requirements or other securities law requirements in relation to such offer. The consent referred to above relates to Offer Periods (if any) ending no later than the date falling twelve (12) months from the date of the approval of the Base Prospectus by the Autorité des marchés financiers. The Terms and Conditions of the Public Offer shall be provided to investors by that Authorised Offeror at the time of the Public Offer. Neither the Issuer nor any of the Dealers or other Authorised Offerors has any responsibility or liability for such information. Issue specific summary: [In the context of the offer of the Notes in [France] (''Public Offer Jurisdiction[s]'') which is not made within an exemption from the requirement to publish a prospectus under the Prospectus Directive, as amended (the "Public Offer"), the Issuer consents to the use of the Prospectus in connection with such Public Offer of any Notes during the period from [ ] until [ ] (the "Offer Period") and in the Public Offer Jurisdiction[s] by [ ] / [any financial intermediary] (the "Authorised Offeror[s]"). [The Authorised Offeror[s] must satisfy the following conditions: [ ] The Terms and Conditions of the Public Offer shall be provided to Investors by that Authorised Offeror at the time of the Public Offer. Neither the Issuer nor any of the Dealers or other Authorised Offerors has any responsibility or liability for such information.] / [Not applicable] 7

8 Section B Issuer B.1 The legal and commercial name of the Issuer B.2 The domicile and legal form of the Issuer, the legislation under which the Issuer operates and its country of incorporation SFIL. The Issuer is a French credit institution under the form of a limited liability company (société anonyme à Conseil d'administration) registered with the Registre du Commerce et des Sociétés de Nanterre under No and having its registered office at 1-3 rue du Passeur de Boulogne Issy-les- Moulineaux France. B.4b Description of any known trends affecting the Issuer and the industries in which it operates SFIL operates in two markets: lending to the French local public sector and refinancing of export loans benefiting from a French public guaranty. The main characteristics of the local public sector market are the following: - French local government finances have improved in 2016 despite reductions in transfer payments from the French government. French local authorities managed to post a budget surplus of EUR 3 billion for the year Overall, the financial situation of French local authorities remains very solid when compared to European peers. Total debt of French local authorities stood at 8.9% of Gross Domestic Product in 2016 compared to a Euro area average of 15.4%. The management of French public guarantees for export contracts in 2016 was characterized by the following key figures 1 : - Outstanding French public guarantees for export contracts amounted to EUR 64 billion at the end of 2016, a reduction by EUR 2 billion in terms of outstanding volume compared to the previous year was characterized by a reduction in the volume of new export credit guarantees (-24%) and a reduction in terms of number of transactions (-11%) - A wide range of industries benefited from export guarantees in 2016 reflecting the sector specialization of the French economy around key industries such as transportation and capital goods. B.5 A description of the Issuer's Group and the Issuer's position within the Group The share capital of the Issuer is held at 75% by the French State via the Agence des Participations de l Etat (French government shareholding agency), 20% by Caisse des Dépôts et Consignations and 5% by La Banque Postale. Since the Issuer was created, the French State plays a special role by contributing 75% of the Issuer s capital, and as the reference shareholder by supplying prudential authorities with a strong commitment to provide financial support, in compliance with current banking regulations. 1 Source : 8

9 We present below a chart detailing the shareholder structure of SFIL: B.9 Profit forecast or estimate B.10 Qualifications in the auditors' report B.12 Selected historical key financial information Not applicable, as there is no profit forecasts or estimates made in respect of the Issuer in the Base Prospectus to which this summary relates. Not applicable, there are no qualifications in any auditors report on the historical financial information included in the Base Prospectus. Selected historical key financial information (IFRS Consolidated): Comparative annual financial data - In EUR millions 31/12/ /12/2015 Total Balance Sheet 78,937 83,683 Debt Securities 57,681 57,740 Equity 1,388 1,385 Net Banking Income Net Income 18 (59) Comparative interim financial data for the six month period ended 30 June In EUR millions 30/06/ /06/2016 9

10 Total Balance Sheet 77,635 85,806 Debt Securities 58,652 60,265 Equity 1,424 1,374 Net Banking Income Net Income 25 7 Statements of no significant or material adverse change There has been no significant change in the financial or trading position of the Issuer or the Group since 30 June 2017 (being the end of the last financial period for which interim financial statements have been published). There has no material adverse change in the prospects of the Issuer since 31 December 2016 (being the end of the last financial period for which audited financial statements have been published). B.13 Recent material events relevant to the evaluation of the Issuer's solvency B.14 Extent to which the Issuer is dependent upon other entities within the Group Not applicable, as at the date of this Base Prospectus and to the best of the Issuer s knowledge, there have not been any recent events which are to a material extent relevant to the evaluation of the Issuer s solvency since 30 June SFIL and its subsidiary Caisse Française de Financement Local are mutually dependent. Due to its size, performance of Caisse Française de Financement Local has an impact on SFIL s revenues. SFIL holds 100% of the share capital of Caisse Française de Financement Local. The role of SFIL as servicer of Caisse Française de Financement Local since 2013 primarily involves the following: to ensure the complete operational management of the company (day-to-day management as well as the operational management of the reduction in the sensitivity of the structured loans on the balance sheet of Caisse Française de Financement Local), as defined by the regulations applicable to sociétés de crédit foncier, in particular in accordance with Article L of the French Code monétaire et financier. SFIL is also the agent of the enhanced guarantee within the framework of the export credit refinancing activity; and to provide Caisse Française de Financement Local with the derivatives and non-privileged funding it needs to carry out its activities. B.15 Principal activities of the Issuer The Issuer carries out four principal activities: Refinancing of local public sector loans, a public policy mission entrusted by the French State to the Issuer in 2013, within a strictly defined framework, initially granted by La Banque Postale to eligible local authorities and public healthcare facilities via issuance of covered bonds (obligations foncières) by Caisse Française de Financement Local ("CAFFIL") since 2013; 10

11 Providing specialized services to La Banque Postale and Caisse Française de Financement Local allowing for the proper operation of the scheme; Refinancing the insured part of large export credit contracts, a public policy mission entrusted by the French State to the Issuer in Those export credits initially arranged and granted by commercial banks are refinanced via issuance of covered bonds by Caisse Française de Financement Local; and Reducing the sensitivity of certain structured loans contained in the assets on the balance sheet of Caisse Française de Financement Local, in line with the objectives defined by the French State in terms of the management of public finances and respecting the Issuer s strategic interests. B.16 Extent to which the Issuer is directly or indirectly owned or controlled The French State is the reference shareholder of the Issuer under French regulation. The Banque de France may ask the French State, as reference shareholder, to provide the necessary support to the Issuer in accordance with Article L of the French Code monétaire et financier. The share capital of the Issuer is held as follows: 75% by the French State via the Agence des Participations de l Etat (French government shareholding agency), i.e. 6,964,293 ordinary shares; 20% by Caisse des Dépôts et Consignations, i.e. 1,857,145 preferred shares; and 5% by La Banque Postale, i.e. 464, 287 ordinary shares. B.17 Credit ratings assigned to the Issuer or its debt securities Notes to be issued under the Programme are expected to be rated AA by Standard & Poor s Credit Market Services France SAS ("S&P"), Aa3 by Moody s Investors Service Ltd ("Moody s") and AA- by Fitch France SAS ("Fitch"), which are established in the European Union and registered under Regulation (EC) No. 1060/2009 on credit ratings agencies, as amended (the "CRA Regulation"), and included in the list of credit rating agencies registered in accordance with the CRA Regulation published on the European Securities and Markets Authority's website ( as of the date of the Base Prospectus. The rating (if any) will be specified in the Final Terms. A security rating is not a recommendation to buy, sell or hold securities and may be subject to suspension, reduction or withdrawal at any time by the assigning rating agency. Issue specific summary: Credit ratings: [Not applicable/the Notes to be issued are expected to be rated]: [S&P: [ ]] [Moody s: [ ]] [Fitch: [ ]] 11

12 Section C Securities C.1 Type, class and identification number of the Notes Up to Euro 5,000,000,000 (or the equivalent in other currencies at the date of issue) aggregate nominal amount of Notes outstanding at any one time pursuant to the Euro Medium Term Note Programme arranged by Barclays Bank PLC (the "Programme"). The Notes will be issued on a syndicated or non-syndicated basis. The Notes will be issued in series (each a "Series") having one or more issue dates and on terms otherwise identical, the Notes of each Series being intended to be fungible (other than in respect of the first payment of interest, the issue date, the issue price and the nominal amount) with all other Notes of that Series. Each Series may be issued in tranches (each a "Tranche") on the same or different issue dates. The specific terms of each Tranche (except the issue date, issue price, first payment of interest and nominal amount of the Tranche, which will be identical to the terms of other Tranche of the same Series) will be set out in a Final Terms (the "Final Terms"). Notes may be issued in either dematerialised form ("Dematerialised Notes") or materialised form ("Materialised Notes"). Dematerialised Notes may, at the option of the Issuer, be issued in bearer dematerialised form (au porteur) or in registered dematerialised form (au nominatif) and, in such latter case, at the option of the relevant holder, in either au nominatif pur or au nominatif administré form. No physical documents of title will be issued in respect of Dematerialised Notes. Materialised Notes may be in materialised bearer form ("Materialised Bearer Notes") only if they are issued outside France. A Temporary Global Certificate will be issued initially in respect of each Tranche of Materialised Bearer Notes. The Notes have been accepted for clearance through Euroclear France as central depositary in relation to Dematerialised Notes and Clearstream Banking S.A. ("Clearstream"), Euroclear Bank S.A./N.V. ("Euroclear") or any other clearing system that may be agreed between the Issuer, the fiscal agent in respect of the Programme (the "Fiscal Agent") and the relevant Dealer in relation to Materialised Notes. An identification number of the Notes (ISIN) and a common code will be specified in the relevant Final Terms. Issue specific summary: Series Number: Tranche Number: Aggregate Nominal Amount: Series: Tranche: Form of Notes: [ ] [ ] [ ] [ ] [ ] [Dematerialised Notes / Materialised Notes]. [If the Notes are Dematerialised Notes: Dematerialised Notes are [in bearer dematerialised form (au porteur) / in registered dematerialised form (au nominatif) / in administered registered form (au nominatif administré) / in fully registered form (au nominatif pur)].] 12

13 ISIN: Common Code: Central Depositary: Any clearing system(s) other than Euroclear Bank S.A./N.V. and Clearstream Banking, S.A. and the relevant identification number(s): [If the Notes are Materialised Notes: Materialised Notes will be in bearer form only] [ ] [ ] [Euroclear France] / [Clearstream] / [ ]] [Not applicable]/[give name(s) and number(s) [and address(es)]] C.2 Currencies Notes may be denominated and/or payable in any currency agreed between the Issuer and the relevant Dealers. Issue specific summary: The currency of the Notes is: [ ] C.5 Description of any restrictions on the free transferability of the Notes C.8 Description of rights attached to the Notes Save certain restrictions regarding the purchase, offer, sale and delivery of the Notes, or possession or distribution of the Base Prospectus, any other offering material or any Final Terms, there is no restriction on the free transferability of the Notes. Arranger The arranger in respect of the Programme (the "Arranger") is: Barclays Bank PLC Dealers under the Programme The dealers in respect of the Programme (the "Dealers") are: - Barclays Bank PLC - BNP Paribas - Citigroup Global Markets Limited - Crédit Agricole Corporate and Investment Bank - Deutsche Bank Aktiengesellschaft - HSBC France - J.P. Morgan Securities plc - Natixis - Société Générale The Issuer may from time to time terminate the appointment of any dealer under the Programme or appoint additional dealers either in respect of one or more Tranches or in respect of the whole Programme. References in the Base Prospectus to "Permanent Dealers" are to the persons listed above as Dealers and to such additional persons that are appointed as dealers in respect of the whole Programme (and whose appointment has not been terminated) and to "Dealers" are to all Permanent Dealers and all persons appointed as a dealer in respect of one or more Tranches. Issue price Notes may be issued at their nominal amount or at a discount or premium to their nominal amount. 13

14 Specified denomination The Notes will be in such denominations as may be specified in the relevant Final Terms. The Notes will be issued in such denomination(s) as may be agreed between the Issuer and the relevant Dealer. Notes having a maturity of less than one (1) year will constitute deposits for the purposes of the prohibition on accepting deposits contained in section 19 of the Financial Services and Markets Act 2000 (the FSMA ) unless they are issued to a limited class of professional investors and have a denomination of at least 100,000 or its equivalent in other currencies. Dematerialised Notes shall be issued in one Specified Denomination only. Status of the Notes The Notes and (if applicable) the relative Coupons are direct, unconditional, unsecured and unsubordinated obligations of the Issuer and rank and will rank pari passu and without any preference among themselves and at least pari passu with all other direct, unconditional, unsecured and unsubordinated obligations of the Issuer (save for statutorily preferred exceptions). Negative pledge So long as any of the Notes or Coupons on Notes remains outstanding, the Issuer will not create or permit to subsist any mortgage, charge, pledge, lien or other security interest (sûreté réelle) upon the whole or any part of its undertaking, revenues or assets, present or future, in order to secure any Relevant Indebtedness, without at the same time according to the Notes or Coupons the same, or substantially the same, security interest. "Relevant Indebtedness'' means any indebtedness for borrowed money of the Issuer which is in the form of or represented by any bond (obligation) or note or any other security which is, or is capable of being, listed, quoted or traded on any stock exchange or in any securities market (including, without limitation, any over-the-counter market). Event of default The terms of the Notes will contain Events of Default including non-payment, non-performance or non-observance of the Issuer s obligations in respect of the Notes, a cross-default in respect of the Notes and dissolution or merger of the Issuer into a company prior to the repayment in full of the Notes. Withholding tax All payments of principal and interest by or on behalf of the Issuer in respect of the Notes or Coupons shall be made free and clear of, and without withholding or deduction for, any taxes, duties, assessments or governmental charges of whatever nature imposed, levied, collected, withheld or assessed by or within France or any authority therein or thereof having power to tax, unless such withholding or deduction is required by law. If French law should require that payments of principal or interest in respect of any Notes or Coupon be subject to withholding or deduction in respect of any 14

15 taxes, duties, assessments or governmental charges of whatever nature, the Issuer will, save in certain limited circumstances, to the fullest extent then permitted by law, pay such additional amounts as shall result in receipt by the Noteholders or, if applicable the Couponholders, as the case may be, of such amounts as would have been received by them had no such withholding or deduction been required. Governing law French law. Issue specific summary: Issue Price: [ ] per cent. of the Aggregate Nominal Amount [plus accrued interest from [insert date] (if applicable)] Specified Denomination[s]: [ ] Status of the Notes: Event of default: Senior The terms of the Notes will contain Events of Default including non-payment, nonperformance or non-observance of the Issuer s obligations in respect of the Notes, a crossdefault in respect of the Notes and dissolution or merger of the Issuer into a company prior to the repayment in full of the Notes. C.9 Interest, maturity and redemption provisions, yield and representation of the holders of Notes Please also refer to the information provided in item C.8 above. Interest rates and interest periods The Final Terms will specify whether the Notes bear interest. The length of the interest periods for the Notes and the applicable interest rate may differ from time to time or be constant for any Series. Notes may have a maximum interest rate, a minimum interest rate, or both, provided that in no event, will the relevant interest amount be less than zero. The use of interest accrual periods permits the Notes to bear interest at different rates in the same interest period. All such information will be set out in the relevant Final Terms. Fixed Rate Notes Fixed interest will be payable in arrear or in advance on each Interest Payment Date specified in the relevant Final Terms. Floating Rate Notes Floating Rate Notes will bear interest payable in arrear or in advance on each Interest Payment Date, specified in the relevant Final Terms. Floating interest shall be determined as follows: (i) on the same basis as the floating rate under an interest rate swap transaction in the relevant Specified Currency governed by the June 2013 FBF Master Agreement as published by the Fédération Bancaire 15

16 Française, or (ii) on the same basis as the floating rate under an interest rate swap transaction in the relevant Specified Currency governed by an agreement incorporating the 2006 ISDA Definitions published by the International Swaps and Derivatives Association, Inc., or (iii) by reference to LIBOR, EURIBOR, EONIA, CMS Rate or TEC 10, in each case as adjusted for any applicable margin. Floating rate Notes may also have a maximum rate of interest, a minimum rate of interest or both. Fixed/Floating Rate Notes Fixed/Floating Rate Notes for which a change of interest basis is specified to be applicable may be issued by the Issuer, such change of interest being either at the option of the Issuer or automatic. Zero Coupon Notes Zero Coupon Notes may be issued at their nominal amount or at a discount to it and will not bear interest. Inflation Linked Notes Inflation Linked Notes may be issued by the Issuer where the interest and/or principal in respect of such Notes will be calculated by reference to an inflation index ratio (in each case, the "Inflation Index Ratio") derived from: - the consumer price index (excluding tobacco) for all households in France or the relevant substitute index, as calculated and published monthly by the Institut National de la Statistique et des Etudes Economiques ("INSEE") (the "CPI") (the "CPI Linked Notes"); or - the harmonised index of consumer prices (excluding tobacco), or the relevant substitute index, measuring the rate of inflation in the European Monetary Union as calculated and published monthly by Eurostat (the "HICP") (the "HICP Linked Notes"). Maturities Subject to compliance with all relevant laws, regulations and directives, any maturity in excess of one (1) month or such other minimum maturity as may be required from time to time by the relevant regulatory authority. No maximum maturity is contemplated and Notes may be issued with no specified maturity dates provided, however, that Notes will only be issued in compliance with all applicable legal and/or regulatory requirements. Redemption The relevant Final Terms will specify the basis for calculating the redemption amounts payable in accordance with the Terms and Conditions of the Notes. Unless previously redeemed, purchased and cancelled, each Note shall be finally redeemed on the Maturity Date specified in the relevant Final Terms at its Final Redemption Amount (which is not less than its nominal amount). Unless permitted by then current laws and regulations, Notes (including Notes denominated in Sterling) having a maturity of less than one (1) year from the 16

17 date of issue and in respect of which the issue proceeds are to be accepted by the Issuer in the United Kingdom or whose issue otherwise constitutes a contravention of section 19 of the FSMA must have a minimum redemption amount of 100,000 (or its equivalent in other currencies). Optional redemption The Final Terms issued in respect of each issue of Notes will state whether such Notes may be redeemed prior to their stated maturity at the option of the Issuer (either in whole or in part) or at the option of the Noteholders and if so the terms applicable to such redemption. Any early redemption of Notes can only be made subject to certain conditions. Early redemption Except as provided in "Optional redemption" above, Notes will be redeemable prior to maturity in case of illegality and, at the option of the Issuer, for taxation reasons. Yield The Final Terms issued in respect of each issue of Fixed Rate Notes will set out an indication of the yield of the Notes. Representation of the holders of Notes In respect of the representation of the holders of the Notes the following shall apply: (a) (b) (c) If the relevant Final Terms specify that "Full Masse" is applicable, the holders of Notes will, in respect of all Tranches in any Series, be grouped automatically for the defence of their common interests in a Masse and the provisions of the French Code de Commerce relating to the Masse shall apply; and If the relevant Final Terms specify that "Contractual Masse" is applicable, the holders of Notes will, in respect of all Tranches in any Series, be grouped automatically for the defence of their common interests in a Masse. The Masse will be governed by the provisions of the French Code de Commerce with the exception of Articles L , L , L , R , R and R and the second sentence of Article L II. If and for so long as the Notes of any Series are held by a sole Noteholder, such Noteholder shall exercise all the powers, rights and obligations entrusted with the Representative and General Meeting. Such sole Noteholder shall hold a register of the decisions it will have taken in its capacity and shall make it available, upon request, to any subsequent holder of all or part of the Notes of such Series. If either paragraph (a) or (b) above is provided as applicable in the relevant Final Terms, the Masse will act in part through a representative (the "Representative") and in part through general meetings of the holders of Notes. The names and addresses of the initial Representative and its alternate will be set out in the relevant Final Terms. The Representative appointed in respect of the first Tranche of any Series of Notes will be the representative of the single Masse of all Tranches in such Series. 17

18 Issue specific summary: Rate[s] of Interest: Interest Commencement Date: Maturity Date: Final Redemption Amount of each Notes: Call Option: Put Option: Optional Redemption Amount: Early Redemption Amount: Yield (in respect of Fixed Rate Notes): [[ ] per cent. Fixed Rate] [[ ] +/- [ ] per cent. Floating Rate] [Fixed/Floating Rate] [Zero Coupon] [CPI Linked Interest] [HICP Linked Interest] [Specify/Issue Date/Not applicable] [ ] [Specify date or (for Floating Rate Notes) Interest Payment Date falling in or nearest to the relevant month and year] [[ ] per Note of [ ] Specified Denomination]/[give details in relation to Inflation Linked Notes] [Applicable]/[Not applicable] [Applicable]/[Not applicable] [Applicable: [ ] per Note of [ ] Specified Denomination / Not applicable] [Applicable: [ ] per Notes of [ ] Specified Denomination/ [give details in relation to Inflation Linked Notes] / Not applicable] [ ]/[Not applicable] C.10 Derivative component in interest payments Representation of the holders of Notes: [Full Masse/Contractual Masse] The Masse will act in part through a representative (the "Representative") and in part through general meetings of the holders of Notes. The name and address of the initial Representative are [ ] and of its alternate are [ ]. The Representative(s) appointed in respect of the first Tranche of any Series of Notes will be the representative of the single Masse of all Tranches in such Series. Other than Inflation Linked Notes, Notes issued under the Programme do not contain any derivative components. Inflation Linked Notes are Notes in respect of which the principal and/or the interest amount is linked to: - the consumer price index (excluding tobacco) for all households in France or the relevant substitute index, as calculated and published monthly by the INSEE (CPI); or - the harmonised index of consumer prices (excluding tobacco), or the 18

19 relevant substitute index, measuring the rate of inflation in the European Monetary Union as calculated and published monthly by Eurostat (HICP). The value of the investment in the Inflation Linked Notes may be affected by the value of the CPI or HICP, as the case may be, as described in item C.15 below. C.11 Admission to trading Notes of any particular Series may be admitted to trading on Euronext Paris or as otherwise specified in the applicable Final Terms. The applicable Final Terms will state whether a Series of Notes may or may not be admitted to trading. Issue specific summary: [[Application has been made]/[application is expected to be made] by the Issuer (or on its behalf) for the Notes to be admitted to trading [on [Euronext Paris] / [ ]] with effect from [ ]]/[Not applicable] C.15 Description of how the value of investment is affected by the value of the underlying instrument Inflation Linked Notes are debt securities which do not provide for predetermined interest payments and/or redemption amount. Interest amounts and/or principal is linked to: (i) the consumer price index (excluding tobacco) for all households in France or the relevant substitute index, as calculated and published monthly by the INSEE; or (ii) the harmonised index of consumer prices (excluding tobacco), or the relevant substitute index, measuring the rate of inflation in the European Monetary Union as calculated and published monthly by Eurostat. If, at maturity, the level of the relevant Inflation Index Ratio is less than 1.00, the Notes will be redeemed at par. Issue specific summary: The value of the investment in the Inflation Linked Notes may be affected by the level of the [CPI/HICP]. Indeed, this inflation index affects the redemption amount and interest amount calculated as specified in item C.9 above. C.16 Inflation Linked Notes Maturity Subject to compliance with all relevant laws, regulations and directives, any maturity set out in the Final Terms. Issue specific summary: The maturity date of Inflation Linked Notes is [ ]. C.17 Inflation Linked Notes Settlement procedure C.18 Return on Inflation Linked Notes The Inflation Linked Notes will be cash settled. Payments of interest in respect of any Inflation Linked Notes indexed to the CPI or HICP applicable from time to time for each Interest Accrual Period (as specified in the relevant Final Terms) will be equal to the fixed rate per annum specified in the relevant Final Terms multiplied by the Inflation Index Ratio. Payment of principal in respect of Inflation Linked Notes where the principal amount is indexed shall be determined by multiplying the outstanding nominal 19

20 amount of such Notes by the relevant Inflation Index Ratio. However, if, at maturity, the level of the relevant Inflation Index Ratio is less than 1.00, the Notes will be redeemed at par. C.19 Inflation Linked Notes Exercise price/ Final reference price C.20 Inflation Linked Notes Description of Underlying The final redemption amount in respect of Inflation Linked Notes will be calculated on the basis of the ratio between the index on the Maturity Date and the Base Reference specified in the relevant Final Terms. Please also refer to item C.9 above. Inflation Linked Notes are Notes where the coupons and/or the principal are indexed. In the case of Inflation Linked Notes in respect of which interest is indexed, the coupon pays the annual change in inflation, applied in percentage to the issue's nominal amount. In the case of Inflation Linked Notes where the principal is indexed, the principal is indexed to the variation of inflation between the value of the relevant index (i.e. the CPI or the HICP) on the issue date and on the redemption date. Issue specific summary [Insert for CPI Linked Notes] CPI Linked Notes CPI Linked Notes are linked to the consumer price index (excluding tobacco) for all households in France, as calculated and published monthly by the INSEE: the CPI. The CPI is the official instrument for measuring inflation. It allows an estimation between two given periods of the average change in prices of goods and services consumed by households on French territory. It is a summary gauge of movements in prices of products on a constant-quality basis. Information regarding the CPI can be found at Agence France Trésor Reuters page OATINFLATION01 or on Bloomberg FRCPXTOB Index <GO> pages and on the website [Insert for HICP Linked Notes] HICP Linked Notes HICP Linked Notes are linked to the Eurozone harmonised index of consumer prices (excluding tobacco), as calculated and published monthly by Eurostat and the national statistical institutes in accordance with harmonised statistical methods: the HICP. The HICP is an economic indicator constructed to measure the changes over time in the prices of consumer goods and services acquired by households in Europe. Information regarding HICP can be found at Agence France Trésor Reuters page OATEI01, on the website and on Bloomberg page CPTFEMU Index <GO>. C.21 Negotiation Market(s) Notes may (or not) be admitted to trading on Euronext Paris or any other regulated market, as may be specified in the relevant Final Terms. The Base Prospectus will be published for the purposes of this or these regulated market(s). Issue specific summary [The Notes will be admitted to trading on [Euronext Paris]/[ ].]/[Not applicable.] 20

21 Section D -Risk Factors D.2 Key information on the key risks that are specific to the Issuer or its industry There are certain factors that may affect the Issuer s ability to fulfil its obligations under Notes issued under the Programme. Main factors which may have an impact on the Issuer are as follows: 1. Credit rating of the Issuer will be affected by the credit rating of the French State The shareholding of the Issuer renders it indirectly dependent on the situation of the French State. The credit rating of the Issuer is therefore closely linked to that of the French State. In the event of a downgrade of the credit rating of the French State, ratings of the Issuer and of the Notes may be affected. 2. Noteholders have recourse only to the Issuer The Notes are liabilities of the Issuer only, and Noteholders will therefore only have recourse to the Issuer for payments due under the Notes. 3. Issuer s Geographic and Concentration Risk The Issuer operates primarily within the French market. A weakening of the French economy could therefore bring about a decline in the Issuer s activity. Furthermore, the Issuer holds a significant amount of assets representing lending to borrowers in Italy and Switzerland. Adverse financial, economic and fiscal conditions in these economies and perceived weaknesses of a country s financial situation may also have an adverse impact on the credit quality of these assets and consequently potentially adversely affect the Issuer. 4. Credit Risk Credit risk represents the potential loss that the Issuer may incur by reason of the deterioration of its counterparties solvency. A default by any of its counterparties or clients could have an effect on its financial situation. This risk can adversely affect the financial intermediaries, banks and depositories with which the Issuer operates daily which may therefore adversely affect its income, returns and solvency. The Issuer faces credit risk on its loans and bonds portfolio, including its treasury portfolio. The ability of public sector borrowers, including local authorities and municipalities, to meet their payment obligations may be affected by their levels of indebtedness, social spending obligations, interest rates and tax revenue collections, transfers of subsidies from the central governments, each of which could be adversely affected by a deterioration of general economic conditions. Deteriorating economic conditions could therefore have a material adverse effect on the credit quality of the assets of the Issuer. 5. The Issuer may face a decrease in its activity and in its margins in the local authority and municipal lending market or in the refinancing of export credit The Issuer may face increasing competition in the local authority and municipal lending market or in the refinancing of export credit. Furthermore, the Issuer may face pricing pressure in certain areas of its operations in the future as competitors seek to increase market share by reducing prices, or 21

22 offering new services at low prices. 6. Risk relating to the public policy missions entrusted by the French State to SFIL Two of SFIL s principal activities are public policy missions entrusted by the French State: (i) the refinancing of local public sector loans and (ii) the refinancing of buyer credits insured by the French public export credit agency under the French State s control, on its behalf and in its name and thereby to help enhance the competitiveness of the large export contracts negotiated by French firms. If SFIL s public policy missions were withdrawn by the French State, it could potentially adversely affect the Issuer. 7. Risk linked to the privileges granted to other creditors In case of insolvency proceedings opened against the Issuer, the Noteholders may be adversely affected by the privileges granted to other creditors. 8. The Issuer is exposed to certain litigation linked to structured loans which could adversely affect its business, financial condition and results of operations In its portfolio, the Issuer has structured loans considered as sensitive that were granted to French borrowers of Dexia Crédit Local. Certain local authorities and municipalities initiated legal proceedings against Dexia Crédit Local, the Issuer and/or Caisse Française de Financement Local. These litigations may lead to certain loans being declared void or voidable in whole or in part. In such cases, it may affect substantially cash flows, results of operations and financial condition of the Issuer. 9. The Issuer is exposed to certain litigation linked to tax matters Such litigations may negatively impact the results of operations and financial condition of the Issuer. 10. Evolutions in the applicable financial regulations governing financial institutions The Issuer is a credit institution and is therefore subject to financial laws and regulations. French and European financial laws and regulations have been in constant evolution during the last years, and the legal framework is still being developed. These regulatory evolutions (notably the leverage ratio) could have an impact on its business activity and may create operational and legal risks in the short and medium terms. 11. Changes to the accounting standards The Issuer cannot predict with any certainty at this time the potential impact of any changes in the accounting standards (or of other potential future modifications to these standards); however any significant modifications to the accounting standards may adversely impact its operations and financial condition. 12. Market Risks Market risk is limited to the market risk of the trading portfolio on a consolidated basis. SFIL does not carry out trading operations, and is therefore not subject to market risk in the regulatory sense of the term. Nonetheless, for loans hedged using derivatives and becoming non performing, the 22

23 corresponding derivatives become subject to market risk in the regulatory sense of the term if the accounting hedge relationship is broken. In addition, the positions or activities of the banking book of SFIL, which are monitored in terms of non-regulatory market risks, pose a risk resulting from exposure to the volatility of market parameters. There also are other non regulatory market risks such as changes in accounting value based on derivatives. Therefore, market risks exist and any decline in the debt markets could have an adverse effect on the financial situation, operations and cash flows of SFIL. Besides, some derivatives are not recorded in a hedging relationship. That results from derivatives that hedge the foreign exchange risk related to export credit financing loans denominated in a currency other than the euro, and that are concluded before the end of the drawing phase of the hedged loans. Hedging of currency risk relating to monetary assets or liabilities cannot be documented, in accordance with IAS 39, before they are recorded in the entity s balance sheet. 13. Counterparty risk on derivatives The Issuer enters into derivative transactions with a number of bank counterparties as part of its currency and interest rate hedging operations. These derivatives are governed by master agreements that provide for the bilateral exchange of collateral or unilateral exchange of collateral in favour of Caisse Française de Financement Local. While having collateral agreements and hedging derivatives with a large number of counterparties is designed to mitigate risk, the Issuer is nonetheless exposed to the risk of default of its derivative counterparties. 14. Counterparty risk on financial assets The assets of the Issuer are invested in various types of debt instruments. The Issuer is therefore exposed to the evolutions of the value of its portfolio in case of decrease in the prices of these financial assets and is also exposed to counterparty risks in relation to these financial assets. 15. Foreign exchange risk Foreign exchange risk is the verified or potential risk of volatility of income related to adverse movements in foreign exchange rates. 16. Liquidity risk Liquidity risk can be defined as the risk that the Issuer may not be able to find the necessary liquidity to cover the financing needs related to its activity, and/or may not be able to settle its liabilities in due date. There is a risk that the Issuer cannot sell a financial asset at its true value or cannot sell it at all. As a consequence, the Issue faces the risk that it cannot meet its obligations, such as being unable to reimburse its counterparties or investors. 17. Risks linked to financial conditions offered for export credit refinancing loans In the context of the extension of its activities to the refinancing of large export credit, the particular features of these loans lead SFIL to give a commitment on financial conditions several months before the signing of the loan contract. The financial conditions at the time of the offer might no longer be in line with the refinancing and hedging conditions at the time and after the signing date of the contract. Changes in market conditions could therefore adversely affect its results of operations, financial conditions and business prospects. 23

24 In order to reduce currency and spread risks, hedging operations may be entered into as soon as a firm offer for a credit refinancing has been delivered. In some cases, the credit may not be signed and related hedging operations may be cancelled, which could adversedly affect SFIL s results of operations, financial conditions and business prospects. 18. Operational risks The main operational risks can be divided into the following categories; - risk of internal or external fraud: from an employee or a third party; - human resources and skills risk: this relates to the inadequacy of the available skills and human resources (including key-men and training), errors in setting hiring, salaries and careers management policies, social relations in relation to employees representation or negotiation processes; - the risks relating to information systems which include risks relating to the planning of systems development, risk of design, development, maintenance and security of applications, and risks related to the use of applications and software; - risks relating to the conduct of operations (in particular, risks relating to the EU local authority and municipal lending market): information reliability, compliance with procedures, reliability of deliverables, human errors and inadequate monitoring of activities; - risks relating to operational organisation: this risk relates to the inadequacy of the strategy and organisation of the Issuer and the inefficiency of defined processes or inappropriate definition of interfaces; - risks relating to compensation delays in relation to insurance policies, including insurance on export credit; - security risks: this risk relates to the continuity and resumption of activities (including the establishment of a business continuity plan), goods and individuals; - commercial and partnership risks: risks regarding the default of a partner, the sharing of responsibilities, commissioning, products distribution, knowledge of clients' needs and ethics; - risks relating to professional conduct: the risk of a failure to comply with professional conduct when dealing with clients and the reputational risk linked to this failure to comply. In particular, this could be linked to a failure to comply with the laws governing EU local authority and municipal lending or a failure by Caisse Française de Financement Local to comply with the legislation applicable in France to covered bonds (obligations foncières) or a failure to comply with Export Credit regulations; and - risks relating to failure of anti-money laundering policies. The occurrence of any such abovementioned operational risks may affect the Issuer s business, profits and financial situation. 24

25 19. Legal Risk The risk of any litigation brought by a counterparty resulting from an ambiguity, loophole, shortfall which could be imputed to the Issuer. 20. Non-compliance risk SFIL is exposed to a risk of non-compliance. The risk of non-compliance is the risk of a legal, administrative or disciplinary sanction, of a significant financial loss or of a denigration of reputation caused by the non-respect of procedures specific to banking and financial activities, whether they be of legislative or regulatory nature. 21. EU Bank Resolution and Recovery Directive On 2 July 2014, Directive 2014/59/EU providing for the establishment of an EU-wide framework for the recovery and resolution of credit institutions and investment firms entered into force. This Directive is designed to enable a range of actions to be taken by relevant regulatory authorities in relation to credit institutions and investment firms which are considered to be at risk of failing. The exercise of any power under this Directive or any suggestion of such exercise could adversely affect the rights of holders of Notes and/or the price or value of their investment in any Notes and/or the ability of SFIL to satisfy its obligations under any Notes. 22. Implementing of Basel III Risk-Weighted Asset Framework Basel III was implemented under EU legislation through the CRD IV package which consists of the Capital Requirements Directive n 2013/36/EU dated 26 June 2013, the Capital Requirements Regulation n 575/2013 dated 26 June 2013 and the relevant subsequent Delegated Regulations. The implementation of Basel III and the CRD IV package, through the European directives and regulations, has and will continue to bring about a number of substantial changes to the current capital requirements, prudential oversight and risk-management systems, including those of the Issuer. The direction and the magnitude of the impact of Basel III and the CRD IV package will depend on the particular asset structure of each bank and its precise impact on the Issuer cannot be quantified with certainty at this time. The Issuer may operate its business in ways that are less profitable than its present operation in complying with the new guidelines resulting from the transposition of the CRD IV. In addition, the implementation of Basel III and the CRD IV package could affect the risk weighting of the notes in respect of certain investors to the extent that those investors are subject to the new guidelines resulting from the implementation of CRD IV package. Accordingly, recipients of the Base Prospectus should consult their own advisers as to the consequences and effects the implementation of the CRD IV package could have on them. 23. The United Kingdom leaving the European Union could adversely affect the Issuer On 23 June 2016 the United Kingdom ("UK") held a referendum to decide on its membership within the European Union. The UK vote was to leave the European Union and the UK Government invoked its right to withdraw from the European Union under article 50 of the Treaty on the European Union on 29 March Under such article 50, the Treaty on the European Union and the Treaty on the Functioning of the European Union will cease to apply in the UK from the date of entry into force of a withdrawal agreement, or, failing that, 25

26 two years after the notification of intention to withdraw, although this period may be extended in certain circumstances. There are a number of uncertainties in connection with the future of the United Kingdom and its relationship with the European Union. The negotiation of the UK s exit terms is likely to take a number of years. Until the terms and timing of the United Kingdom s exit from the European Union are clearer, it is not possible to determine the impact that the referendum, the UK s departure from the European Union and/or any related matters may have on the Issuer s financial condition. As such, no assurance can be given that such matters would not adversely affect the ability of the Issuer to satisfy its obligations under the Notes and/or the market value and/or the liquidity of the Notes in the secondary market. D.3 Key information on the key risks that are specific to the Notes There are certain factors that may affect the Issuer's ability to fulfill its obligations under Notes issued under the Programme, including: General risks relating to the Notes such as: - Investors must independently review and obtain professional advice with respect to the Notes issued under the Programme; - Actual yield on Notes issued under the Programme may be reduced from the stated yield as a result of transaction cost. Indeed, when the Notes issued under the Programme are purchased or sold, costs may significantly reduce or cancel out the potential profit of Notes (such as, but not limited to, transaction fees, commissions, brokerage fees, custody fees); - Potential conflicts of interest may arise between the holders and various parties operating under the Programme such as, but not limited to, discretionary determination and judgments made by an agent appointed for an issue of Notes under the Programme; - The credit ratings of the Notes may not reflect all risks; - An active trading market for Notes issued under the Programme may never develop; - The trading market for Notes issued under the Programme may be volatile and may be adversely affected by various events; - Modification, waivers and substitution of conditions affecting the Notes that are not desired by all holders can be effected by a majority; - Purchases of the Notes may be subject to certain taxes or other costs; - Change of law - No assurance can be given as to the impact of any possible judicial decision or change in French law or the official application or interpretation of French law after the date of the Base Prospectus; - The proposed financial transaction tax: the draft directive on the proposed common financial transaction tax has a very broad scope and could, if introduced, apply to certain dealings in the Notes (including secondary market transactions) in certain circumstances. Risks related to a particular issue of Notes under the Programme: 26

27 - Notes issued under the Programme may not be a suitable investment for all investors; - Notes may be subject to optional redemption by SFIL; - [(Insert for Fixed Rate Notes) Fixed Rate Notes may not always maintain the same market value;] - [(Insert for Floating Rate Notes) Floating Rate Notes may be volatile;] - [(Insert for Floating Rate Notes) Holders will not be able to calculate their rate of return on Floating Rate Notes in advance;] - [(Insert for Fixed to Floating Rate Notes) Fixed to Floating Rate Notes may have a less favourable spread than the prevailing spreads on comparable floating rate securities tied to the same reference rate;] - [(Insert for Zero Coupon Notes) Zero Coupon Notes issued under the Programme are subject to higher price fluctuations than nondiscounted debt securities;] - [(Insert for Inflation Linked Notes) Holders may be exposed to risk on Inflation Linked Notes which are dependent upon the performance of an index; - Inflation Linked Notes with a multiplier or other leverage factor can be particularly volatile investments; - Additional factors relating to Inflation Linked Notes (such as inflation indices may be subject to significant changes, whether due to the composition of any such inflation index itself, or because of fluctuations in value of the inflation indices; the resulting interest rate will be less (or may be more) than that payable on a conventional debt security issued by the Issuer at the same time; or the holder of an Inflation Linked Note could lose all or a substantial portion of the principal of such Note);] - [(Insert for Floating to Fixed Rate Notes) Floating to Fixed Rate Notes may have a lower new fixed rate;] - Notes are unsecured obligations; - The Redemption Amount may be significantly less than the value of an investment in the Notes. - [(Insert for Notes linked to a benchmark index) The Benchmark Regulation could result in an adjustment to the terms and conditions of the Notes, early settlement, valuation by the Calculation Agent, delisting or other consequences, depending on the specific provisions of the relevant terms and conditions applicable to the Notes.] An investment in the Notes involves certain risks which are material for the purpose of assessing the market risks associated with Notes issued under the Programme. While all of these risk factors are contingencies which may or may not occur, potential investors should be aware that the risks involved with investing in the Notes may lead to volatility and/or a decrease in the market value of the relevant Tranche of Notes whereby the market value falls short of the expectations (financial or otherwise) of an investor who has made an 27

28 investment in such Notes. However, each prospective investor in Notes must determine, based on its own independent review and such professional advice as it deems appropriate under the circumstances, that its acquisition of the Notes is fully consistent with its financial needs, objectives and conditions, complies and is fully consistent with all investment policies, guidelines and restrictions applicable to it and is a fit, proper and suitable investment for it, notwithstanding the clear and substantial risks inherent in investing in or holding the Notes. D.6 Key information on factors which are material for the purpose of assessing the risks associated with Inflation Linked Notes Potential investors in Inflation Linked Notes should be aware that such Notes are debt securities where interest amounts and/or principal will be dependent upon the performance of (i) the consumer price index (excluding tobacco) for all households in France or the relevant substitute index, as calculated and published monthly by the INSEE; or (ii) the harmonised index of consumer prices (excluding tobacco), or the relevant substitute index, measuring the rate of inflation in the European Monetary Union as calculated and published monthly by Eurostat. If, at maturity, the level of the relevant Inflation Index Ratio is less than 1.00, the Notes will be redeemed at par. E.2b Reasons for the offer and use of proceeds Section E Offer The net proceeds of the issue of each Tranche of Notes will be used by the Issuer for its general corporate purposes unless otherwise specified in the relevant Final Terms. Issue specific summary [The net proceeds of the issue of the Notes will be used by the Issuer for its general corporate purposes./specify other] E.3 Terms and conditions of the offer Notes may be offered to the public in France. Any such public offer shall be specified in the applicable Final Terms There are certain restrictions regarding the purchase, offer, sale and delivery of the Notes or possession or distribution of the Base Prospectus, any other offering material or any Final Terms. Other than as set out in section A.2 above, neither the Issuer nor any of the Dealers has authorised the making of any Public Offer by any person in any circumstances and such person is not permitted to use the Prospectus in connection with its offer of any Notes. Any such offers are not made on behalf of the Issuer or by any of the Dealers or Authorised Offerors and none of the Issuer or any of the Dealers or Authorised Offerors has any responsibility or liability for the actions of any person making such offers. Issue specific summary [Not applicable. The Notes are not offered to the public.]/ [The Notes are offered to the public in France]. Offer Price: Conditions to which the offer is subject: [Issue Price/specify] [Not applicable/give details] 28

29 Offer Period (including any possible amendments): Description of the application process: Details of the minimum and/or maximum amount of the application: Manner in and date on which results of the offer are made public: [ ] [Not applicable/give details] [Not applicable/give details] [Not applicable/give details]] E.4 Interests of natural and legal persons involved in the issue of the Notes E.7 Estimated expenses charged to investor by the Issuer or the offeror The relevant Final Terms will specify any interest of natural and legal persons involved in the issue of the Notes. Issue specific summary [So far as the Issuer is aware, no person involved in the offer of the Notes has an interest material to the offer.] / [The Dealers will be paid an aggregate commission equal to [ ] per cent. of the nominal amount of the Notes. So far as the Issuer is aware, no other person involved in the issue of the Notes has an interest material to the offer]. The relevant Final Terms will specify as the case may be the estimated expenses applicable to any Tranche of Notes. Issue specific summary [Not applicable] / [The estimated expenses charged to the investor(s) amount to [ ].] 29

30 RÉSUMÉ EN FRANÇAIS DU PROGRAMME (FRENCH SUMMARY OF THE PROGRAMME) Les résumés contiennent des exigences de publicité appelées " Éléments " dont la communication est requise par l Annexe XXII du Règlement (CE) n 809/2004 du 29 avril 2004, telle que modifiée. Ces éléments sont numérotés dans les sections A à E (A.1 - E.7). Ce résumé contient tous les Éléments devant être inclus dans un résumé pour ce type de valeurs mobilières et pour SFIL (l' "Emetteur"). La numérotation des Éléments peut ne pas se suivre en raison du fait que certains Eléments n ont pas à être inclus. Bien qu un Élément doive être inclus dans le résumé du fait du type de valeur mobilière et d Emetteur concerné, il se peut qu aucune information pertinente ne puisse être donnée sur cet Élément. Dans ce cas, une brève description de l Élément est incluse dans le résumé suivie de la mention " Sans objet ". Ce résumé est fourni dans le cadre de l'émission par l Emetteur de Titres ayant une valeur nominale unitaire inférieure à euros qui sont offertes au public ou admises à la négociation sur un marché réglementé de l Espace Economique Européen (l "EEE"). Le résumé spécifique à ce type d'émission de Titres figurera en annexe des Conditions Définitives applicables et comprendra (i) les informations relatives au résumé du Prospectus de Base et (ii) les informations contenues dans les rubriques "résumé spécifique à l'émission" figurant ci-dessous. Section A Introduction et avertissements A.1 Avertissement Général concernant résumé A.2 Information relative consentement l'emetteur concernant l'utilisation Prospectus le au de du Ce résumé doit être lu comme une introduction au Prospectus de Base. Toute décision d'investir dans les Titres doit être fondée sur un examen exhaustif du Prospectus de Base par les investisseurs, y compris les documents qui y sont incorporés par référence et tout supplément qui pourrait être publié à l avenir. Lorsqu'une action concernant l'information contenue dans le Prospectus de Base est intentée devant un tribunal, le plaignant peut, selon la législation nationale de l État Membre de l EEE, avoir à supporter les frais de traduction du Prospectus de Base avant le début de la procédure judiciaire. Seule peut être engagée la responsabilité civile des personnes qui ont présenté le résumé ou la traduction de ce dernier, mais seulement si le contenu du résumé est trompeur, inexact ou contradictoire par rapport aux autres parties du Prospectus de Base ou s'il ne fournit pas, lu en combinaison avec les autres parties du Prospectus de Base, les informations clés permettant d'aider les investisseurs lorsqu'ils envisagent d'investir dans les Titres. Dans le cadre de toute offre de Titres en France (les "Pays de l Offre au Public") qui ne bénéficie pas de l exemption à l obligation de publication d un prospectus en vertu de la Directive Prospectus, telle que modifiée, (une "Offre au Public"), l Emetteur consent à l utilisation du Prospectus de Base et des Conditions Définitives applicables (ensemble, le "Prospectus") dans le cadre d une Offre au Public de tout Titre durant la période d offre indiquée dans les Conditions Définitives concernées (la "Période d Offre") et dans le(s) Pays de l Offre au Public indiqué(s) dans les Conditions Définitives concernées par : (1) tout intermédiaire financier dûment autorisé et désigné dans ces Conditions Définitives ; ou (2) si cela est indiqué dans les Conditions Définitives concernées, par tout intermédiaire financier qui remplit les conditions suivantes : (a) qui agit conformément à toutes les lois, règles, règlementations et recommandations applicables de toute autorité (les "Règles"), de 30

31 temps à autre, y compris, notamment et dans chacun des cas, les Règles relatives à la fois à l opportunité ou à l utilité de tout investissement dans les Titres par toute personne et à la divulgation à tout investisseur potentiel ; (b) qui respecte les restrictions énoncées dans la partie intitulée Souscription et Vente ("Subscription and Sale") du présent Prospectus de Base qui s'appliquent comme s'il s'agissait d'un Agent Placeur ; (c) qui s assure que tous les frais (et toutes les commissions ou avantages de toute nature) reçus ou payés par cet intermédiaire financier en raison de l'offre ou de la cession des Titres sont entièrement et clairement communiqués aux investisseurs ou aux investisseurs potentiels; (d) qui détient tous les permis, autorisations, approbations et accords nécessaires à la sollicitation, ou à l offre ou la cession des Titres, en application des Règles; (e) qui conserve les dossiers d'identification des investisseurs au moins pendant la période minimum requise par les Règles applicables et doit, sur demande, mettre ces registres à la disposition des Agent(s) Placeur(s) concerné(s) et de l Emetteur ou les mettre directement à la disposition des autorités compétentes dont l Emetteur et/ou les Agent(s) Placeur(s) concerné(s) dépendent afin de permettre à l Emetteur et/ou aux Agent(s) Placeur(s) concerné(s) de respecter les Règles relatives à la lutte contre le blanchiment d'argent, à la lutte contre la corruption et les règles de "connaissance du client " applicables à l'emetteur et /ou aux Agent(s) Placeur(s) concerné(s); (f) qui n entraîne pas, directement ou indirectement, la violation d une Règle par l'emetteur ou les Agent(s) Placeur(s) concerné(s) ou qui ne soumet pas l'emetteur ou les Agent(s) Placeur(s) concerné(s) à l obligation d effectuer un dépôt, d obtenir une autorisation ou un accord dans tout pays ; et (g) qui satisfait à tout autre condition spécifiée dans les Conditions Définitives concernées ; (chacun un " Établissement Autorisé"). L Emetteur accepte la responsabilité, dans le[s] Pays de l Offre au Public désigné[s] dans les Conditions Définitives, du contenu du Prospectus vis-à-vis de toute personne (un "Investisseur") se trouvant dans le Pays de l Offre au Public concerné à qui une offre de tout Titres est faite par tout Établissement Autorisé et lorsque l offre est faite pendant la période pour laquelle le consentement est donné. Toutefois, ni l Emetteur ni aucun Agent Placeur n est responsable des actes commis par tout Établissement Autorisé, y compris concernant le respect des règles de conduite des affaires applicables à l Établissement Autorisé ou à d autres obligations réglementaires locales ou à d autres obligations légales relatives aux valeurs mobilières en lien avec une telle offre applicables à l Établissement Autorisé. Le consentement mentionné ci-dessus s applique à des Périodes d Offre (le cas échéant) se terminant au plus tard à l issue d une période de douze (12) mois à compter de la date d approbation du Prospectus de Base par l Autorité des marchés financiers. Les Modalités de l Offre au Public devront être communiquées aux Investisseurs par ledit Établissement Autorisé au moment de l Offre au Public. Ni l Emetteur ni aucun des Agents Placeurs ou des Établissements Autorisés ne sont responsables de cette information. 31

32 Résumé spécifique à l'émission : [Dans le cadre de toute offre de Titres en [France] (le[s] "Pays de l Offre au Public") qui ne bénéficie pas de l exemption à l obligation de publication d un prospectus en vertu de la Directive Prospectus, telle que modifiée, (une "Offre au Public "), l Emetteur consent à l utilisation du Prospectus dans le cadre d une Offre au Public de tout Titre de [ ] à [ ] (la "Période d Offre") et dans le[s] Pays de l Offre au Public par [ ] / [tout intermédiaire financier] (l [/les] "Établissement[s] Autorisé[s]"). [L [/Les] Etablissement[s] autorisé[s] doit [/doivent] remplir les conditions suivantes : [ ]. Les Modalités de l Offre au Public devront être communiquées aux Investisseurs par le dit Établissement Autorisé au moment de l Offre au Public. Ni l Emetteur ni aucun des Agents Placeurs ou des Établissements Autorisés ne sont responsables de cette information.]/[sans objet] Section B Emetteur B.1 La raison sociale et le nom commercial de l Emetteur B.2 Le siège social et la forme juridique de l Emetteur, la législation qui régit l activité et le pays d origine de l Emetteur B.4b Description de toutes les tendances connues touchant l Emetteur ainsi que des industries de son secteur SFIL. L Emetteur est un établissement de crédit revêtant la forme d une société anonyme à Conseil d'administration immatriculée au Registre du Commerce et des Sociétés de Nanterre sous le numéro et son siège social est sis 1-3 rue du Passeur de Boulogne Issy-les-Moulineaux France. SFIL intervient sur deux marchés: prêts au secteur public local français et refinancement de crédits export bénéficiant d une garantie publique française. Les principales caractéristiques du marché du secteur public local sont les suivantes : - Les finances des collectivités locales françaises se sont améliorées en 2016 en dépit des réductions des budgets alloués par le gouvernement français. Les collectivités locales françaises ont réussi à publier un budget excédentaire de 3 milliards d euros en Globalement, la situation financière des collectivités locales françaises demeure très solide par rapport à celle de leurs homologues européens. La dette totale des collectivités locales françaises est restée à 8,9% du PIB (Produit Intérieur Brut) en 2016 comparée à la moyenne de la zone Euro qui s élève à 15,4 %. La gestion des garanties publiques françaises pour les contrats d export en 2016 a été caractérisée par les chiffres clés suivants 2 : 2 Source : 32

33 - L encours des garanties publiques françaises pour les contrats d export s élevait à 64 milliards d euros à fin 2016, une réduction de 2 milliards en termes de volume d encours comparé à l année précédente a été caractérisée par une réduction en terme de volume des nouvelles garanties de crédit d export (-24%) et une réduction en terme de nombre de transactions (-11%) - Un large éventail de secteurs a bénéficié des garanties export en 2016 reflétant la spécialisation sectorielle de l économie française autour d industries clés tels que le transport et les biens d investissement. B.5 Description du Groupe de l Emetteur et de la position de l Emetteur au sein du Groupe Le capital social de l Emetteur est détenu à 75 % par l Etat français par l intermédiaire de l Agence des Participations de l Etat, 20% par la Caisse des Dépôts et Consignations et 5% par La Banque Postale. Depuis que l Emetteur a été créé, l Etat français joue un rôle particulier en ayant apporté 75% du capital et fourni aux autorités prudentielles, en tant qu actionnaire de référence, un engagement fort de soutien financier, en conformité avec ce que prévoit les réglementations bancaires. Nous présentons ci-dessous un schéma capitalistique de SFIL : B.9 Prévision ou estimation du bénéfice B.10 Réserves contenues dans le rapport des Commissaires aux Sans objet, en l absence de prévision ou estimation du bénéfice concernant l Emetteur au sein du Prospectus de Base sur lequel porte ce résumé. Sans objet, il n existe aucune réserve dans le rapport des commissaires aux comptes sur les informations financières historiques contenues dans le Prospectus de Base. 33